Average UK house prices dropped by 1.4 per cent in the 12 months to December 2023, data from the Office for National Statistics has revealed.
The UK House Price Index: December 2023, pointed out this was an increase from November 2023 which saw a decrease of 2.3 per cent in the 12 months leading up to it.
It added that UK house price annual inflation has been generally slowing since July 2022, when it stood at 13.8 per cent.
The provisional estimate for the average UK house price was £285,000 in December 2023, which is £4,000 lower than 12 months previously.
Atom Bank head of mortgages, Richard Harrison, Head of Mortgages, Atom bank said: “The news of a 1.4 per cent decrease in house prices in December will come as little surprise.”
He explained that a seasonal dip in asking prices is “always expected” in the lead-up to Christmas, and the final month of 2023 saw vendors becoming increasingly competitive, reducing their pricing.
“Likewise, higher mortgage rates and stretched affordability for some buyers may have motivated them to offer below the asking price, in a bid to offset the impact of higher borrowing costs,” he added.
The ONS revealed how prices differed between the UK’s individual countries, explaining that the average house price in England decreased by 2.1 per cent over the 12 months to December 2023.
This represented an increase from the fall of 3 per cent the month prior.
As a result of this decrease, the average house price in England was £302,000 in December 2023, which was £7,000 lower than 12 months ago.
The average house price in Wales as saw a fall, decreasing by 2.5 per cent to December 2023, slightly up from a decrease of 2.9 per cent to November 2023.
This led to the average house price in Wales reaching £214,000 in December, £5,000 lower than the previous year.
Conversely, in Scotland, the average house price increased by 3.3 per cent over the same period, an increase from the 1.1 per cent recorded the previous month.
The average house price in Scotland was £190,000 in December, an increase of £6,000 than a year before.
Regional disparity
The research also revealed an English regional disparity in house prices, detailing that London’s average house prices remain the most expensive of any region in the UK, with an average price of £508,000.
London is also the region with the lowest annual house price inflation, with average prices decreasing by 4.8 per cent.
This represents an increase from an annual inflation rate of -5.5 per cent in the 12 months to November 2023.
In contrast, the North East continued to have the lowest average house price of all English regions, at £158,00.
Additionally, the North West is the English region with the highest annual house price inflation, with average prices increasing by 1.2 per cent.
tom.dunstan@ft.com
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